The Daily News Criticizes State’s Inequitable Treatment of Energy Projects

The Daily News published a striking editorial last week, criticizing the Department of Ecology’s (DOE) unprecedented review of Millennium Bulk Terminals’ project in Longview. The article cast significant doubt on DOE’s motivations, and highlighted disturbing anti-growth bias in the Environmental Impact Statement (EIS).

“From the start of the permitting process, the state Department of Ecology was against the Millennium project,” they wrote. “Anytime it takes five years to get a final environmental impact statement completed it’s pretty clear the state dragged its feet at every turn.” This tedious delay is just one way the state has been impeding the project and undermining economic growth.

The editorial also illustrated how “the state changed the rules in the middle of the game” by requiring Millennium to mitigate 100 percent of foreign emissions on its exports, instead of the 50 percent mitigation required in the original EIS draft. The authors explained the inequity of this mandate, noting that no other local industry is so harshly regulated. Punishing businesses who provide fuel puts them on unequal footing with companies that aren’t required to mitigate foreign emissions.

The state must make decisions based on the rule of law, not on extralegal, personal ideologies. For our economy to thrive, the state must treat all development proposals with consistent respect for the law. Unpredictable decisions like this create uncertainty in the market, driving away companies who want to bring jobs to our state.

Read the full editorial here.

Increased Demand for Coal in Southeast Asia

As nations in Southeast Asia continue to establish their economies, grow their populations, and enter new industries, these countries will undoubtedly need a large source of reliable electricity to accomplish their goals. For an exporter like Washington with long standing trade relationships with our political allies throughout the region, it’s an opportunity we can’t afford to miss.

A report from the International Energy Agency (IEA) found that demand for energy in Southeast Asia could skyrocket over the next two decades with the Southeast Asian region being 78% reliant on fossil fuels by 2040. In fact, coal is projected to overtake oil as the most consumed fuel in the region.  For a number of reasons this transfer from oil to coal for producing electricity is a new positive for the region and presents a massive opportunity in one of the world’s most promising markets.

The IEA report forecasts a strong, sustained rise in demand for coal from many nations to which Washington already maintains trade relationships. This report suggests a rapidly growing market that could generate a huge opportunity for U.S. exporters and subsequently the thousands of Americans they employ. But others will seek to pursue this opening. According to a 2016 report from the Journal of Eurasian Studies, coal is also Russia’s top exporting prospect for Southeast Asia. Along with countries like Indonesia, regional competitors such as Russia will be happy to capitalize on this demand.

Unlike overseas suppliers, Washington will export coal from the Powder River Basin. As we have written in the past, PRB coal is sub-bituminous meaning it contains lower levels of SO2 than other coals, like those found in Appalachia or even in China.  Abundant in Montana and Wyoming, it is a cleaner alternative to what Asian consumers currently utilize.

 

Longview Councilman Joins Lars Larson to Discuss Local Support for MBT in Spite of Ecology’s Overreach

One of Washington’s top radio voices, Lars Larson, invited Longview City Councilman Mike Wallin to his show to discuss the Millennium Bulk Terminals project. Their conversation centered around the Department of Ecology’s recent Environmental Impact Statement (EIS) findings and its controversial implications.

“Just so people understand this, the Millennium Bulk Terminal would create 2,650 jobs and generate $5.4 million in annual tax revenue in Cowlitz County alone,” Larson noted. However, not everyone recognizes these benefits. In its SEPA (State Environmental Policy Act) review, the WA Department of Ecology is attempting to mandate that Millennium mitigate 100 percent of the GHG emissions associated with the use of coal that is just moving through the Millennium project.

“They’re setting a dangerous precedent for all industry coming to Washington state,” Wallin said. “If they have their way, none of these industries will ever be built in our state again.”

Councilman Wallin continued by highlighting that the Department of Ecology’s overreaching and new use of the state’s SEPA power would have much broader implications well beyond Millennium, pointing out how outlandish it would be for Washington to start requiring aircraft manufacturers like Boeing to mitigate their foreign emissions or end use of the product that they manufacture in the state.

“The Department of Ecology has a jurisdictional boundary of Washington state, not the rest of our country, not global jurisdiction,” Wallin said. He explained that the state’s real motivation for this inappropriate review was to “shut the project down,” regardless of its economic benefits. Although Washington has no authority to regulate overseas emissions, Ecology is attempting to overextend its powers with SEPA to impede the Longview project.

However, Wallin remains hopeful that the effort to bring real growth to Washington will prevail. He thinks of the terminal project as a constructive way to clean up a languishing industrial site. “We can take something that’s worthless and create jobs and opportunity and hope for people to go back to work providing for themselves,” he said.

Listen to the full broadcast here.

State penalizes Millennium with unprecedented SEPA findings

Unprecedented SEPA ruling sets bad precedent for trade, exports and jobs

SEATTLE — Washington state is closed for business – unless regulators are comfortable with the commodity or product.

That’s essentially what the Washington State Department of Ecology told Millennium Bulk Terminals today when it ruled the company would have to mitigate for 100% of the emissions generated by overseas use of coal exported through Longview.

Mariana Parks, spokeswoman for the Alliance, offered the following statement in the wake of today’s decision:

“This is use of a state regulatory policy to police the use of products outside of Washington state is simply unheard of. We don’t penalize farmers for agricultural products used in foreign markets, or aerospace manufacturers. But because it’s coal, state polices are being used to enforce the end-use of products around the globe. It’s unprecedented, and telegraphs the wrong message about doing business in Washington state.

As the most trade-dependent state in the country, where one in three jobs is tied to trade, you would expect a more level-headed approach to the regulatory process. This is purely a political decision, and unfortunately, the people of Southwest Washington are being made to pay for it. We’re talking about nearly 3,000 new jobs that would be created with this project and millions in new annual tax revenue, for schools, roads and public safety.

Washington state has the most stringent environmental regulations in the country. So it begs the question, why not build this project here, where we can ensure the product will be handled safely from start to finish? It also gives us pause as we look at the continued economic uncertainty in places like Kelso and Longview, where unemployment rates barely fluctuate below seven percent. What are we doing to help these people and grow jobs in their community? Imagine what 3,000 new jobs would do for a community like Longview.

Millennium Bulk Terminals is committed to building this project right. They’ve already demonstrated their commitment to redeveloping the former Alcoa smelter, spending millions on environmental cleanup of a site that would otherwise still be in distress. Millennium is located in an existing industrial area, it has taken all the steps — jumped through all the regulatory hoops — and the state continues to move the goal line for permits.

Today’s SEPA announcement is a disappointment and a frightening example of the kind of regulatory overreach at play in our state. It’s very disheartening and does not project the right tone for future employers looking to cite a business here in Washington state.”

Rail Safety the Focus of Spokane Radio Program

Courtney Wallace, regional director of public affairs for BNSF Railway, recently spoke with Mike Fitzsimmons on his popular 920 Newscope show on KXLY Radio in Spokane. Wallace and Fitzsimmons spent the hour discussing trains carrying coal through Spokane, with an emphasis on ways that BNSF railway is working to improve rail safety.

As Wallace said upfront, BNSF has spent a significant amount of time studying coal dust, noting that the railroad “has been on the forefront of studying coal dust for over a decade.” She went on to talk about BNSF’s efforts to regulate coal dust, including using a topping agent to coat the coal loads, as well as the shape of the coal cars, which are strategically formed like bread loaf pans to regulate dust. BNSF’s re-spray facilities, like the one in Pasco, apply a glue-like topping agent that helps reduce coal dust by at least 85 percent.

Fitzsimmons, a self-professed train enthusiast, mentioned that he had spent substantial time watching trains with his children, and had never noticed any evidence of coal dust along the rail line. Recounting a recent outing, he said there was “fresh snow on the ground, pure white as it was. Coal train comes through at mainline speed, I couldn’t see a speck of anything on that snow.”

Above all, Wallace emphasized that BNSF railway has an exemplary history of rail safety and environmental stewardship, working to keep communities safe and clean. “Our record on moving hazardous materials from point A to point B without any incident is 99.987%,” she said.

The railways are community partners in the Spokane area and across Washington. As Wallace noted, BNSF employs nearly 4,000 men and women in Washington, and 500 in the greater Spokane area alone. The railroads are an integral part of the state’s economy, and they take safety and environmental compliance seriously.

Millennium Enters Sixth Year Of Permitting Wait

Blow out the candles. February 2017 is now behind us, and the proposed Millennium Bulk Terminals project has officially been awaiting permitting for five full years.

At this point, Washington is at a crossroads. Regulators have a choice – stop the delays on Millennium’s project and be remembered for ushering in a period of economic growth and prosperity, or continue to delay the terminal and go down in history as the group that pushed the limits of economic self-sabotage.

With that in mind, let’s look at some other major construction projects undertaken in the United States for reference. The Empire State Building, nearly synonymous with big construction, took one year and forty five days to build. The Golden Gate Bridge in San Francisco took four years to complete, and Seattle’s own CenturyLink Field took just two years to finish. Millennium, in contrast, still remains in the permitting phase after five full years.

And it’s clear that the revenues and economic benefits the project would produce for Longview, Cowlitz County and the state have been missed. According to Millennium, the project would generate a total of $5.28 million annually in tax revenues. If the project had been completed in 2015, as Millennium expected, it would have generated two years of tax revenues at this point, or a total of $10.56 million. And with all of that money, the state could have purchased 356,396 6th grade history textbooks for Washington students, financed 3,815 stays in state hospitals, or paid the salaries of 158 police officers for a year.

Millennium’s five year wait has deprived the state of needed economic growth for entirely too long. Southwest Washington desperately needed the jobs Millennium’s project would have created five years ago. With an unemployment rate in Cowlitz County that is still higher than the state’s average, that condition has not changed. Washington is the most trade dependent state in the country. Tax revenues and wages from trade related projects finance everything from healthcare to everyday living expenses. The state truly needs projects like Millennium’s to function.

It’s time to let Millennium proceed and allow all Washingtonians to share the project’s economic benefits. The extravagant five year permitting wait casts trade-dependent Washington as a state in conflict with its own identity, and the measureable benefits foregone from lost tax revenues are striking. Millennium’s project is a community investment, and the community can wait no longer.

Millennium’s Project Is Bigger than Washington

Supporters of the Millennium Bulk Terminals project have anticipated that 2017 will be the beginning of the end in the state and federal approval process for the company’s proposed export facility. But as we have come to expect with this project, there will always be those who try to push political agendas at the expense of vital infrastructure investment.

This month was no different. Outgoing Washington State Lands Commissioner Peter Goldmark denied a sublease needed for one of the Millennium project’s loading docks in Longview. While the knee jerk reaction by the media portrayed this decision as a “blow” to the terminals’ final approval, CEO Bill Chapman assured everyone that the decision “has no effect on the project,” and described Goldmark’s action as a “symbolic gesture” by a Commissioner before he exits office.

A recent piece in Fox News quoted Rob McKenna, a former Washington attorney general, on the announcement, who cited a potential violation of the U.S. Constitution’s Inter-State Commerce Clause.

The Inter-State Commerce Clause says that the flow of commerce between states should not be impeded, and in the case of Goldmark’s actions, the move is a clear slight to coal interests in Wyoming and Montana that would ship the fuel via trains to Washington for export. McKenna stated:

“These ports are for the Western United States, and the landlocked states who want to be able to export products overseas need access to those ports. I think it raises real constitutional issues when states systematically try to deny them access to those ports.”

McKenna is absolutely right. Millennium’s project is a development for the Western United States as a whole, and there is much more at stake than the jobs in Southwest Washington. Asian demand for coal is growing. In fact, China breaks ground on a new coal plant every week, and India, Vietnam, and Japan are expanding their capacity as well. This increased demand presents a tremendous opportunity for coal producers in Wyoming and Montana. But as landlocked states, they are only able to transport their coal to ports on the West Coast via rail.

As CEO Bill Chapman noted, Goldmark’s actions are largely symbolic and fall in line with other environmentalist efforts on the West Coast to oppose fossil fuel related projects at all costs. But it is important to keep the bigger picture in mind. A violation of the U.S. Constitution cannot be justified by the whims of any one faction, and Millennium’s project would support jobs and families in Wyoming, Montana, Washington and every state along the rail lines in between. Opponents of Millennium would be wise to keep in mind the greater implications of their fight.

Maritime Expert Calls For Emphasis On Infrastructure In 2017

In a recent op-ed in The Hill, Dave Matsuda, a former U.S. Maritime Administrator under the Obama administration, calls for bipartisan cooperation to increase infrastructure investment under the new administration. For Washington, he says, momentum created by President-elect Trump’s promised commitment to infrastructure investing is a great opportunity to address regulatory and policy issues around the state’s famed maritime sector.

Matsuda argues that Washington’s “legacy as a natural corridor to and from the Pacific” is dependent upon a “strong, well-integrated transportation sector.” However, he cautions, “even with existing infrastructure and Washington’s coastal position, the current reality is the state continues to lose ground to competition.”

In order to reverse this decline, Matsuda points to recommendations laid out in a policy brief he authored alongside Steve Rothberg, a maritime expert and partner at Mercator International, a maritime consulting firm, late last year. The report points to three primary challenges to maritime growth and notes several corresponding policy reforms that state regulators and officials can carry out to ensure Washington ports can successfully compete with other growing maritime hubs in North America.

One of the challenges mentioned, the issue of a lack of clear project siting and permitting process, is particularly salient for Washington today. The Millennium Bulk Terminals project has been awaiting permitting for nearly five years, facing an onslaught of red tape and environmental mitigation mandates that are unprecedented. The competition has found ways to deal with these problems – Canada passed a ‘shot clock’ bill that mandates completion of permitting within 18 months – and as Matsuda notes, “if Washington bears a reputation for being more unsupportive to maritime and port business than other states, new project opportunities will look elsewhere for siting and existing employers will eventually follow.”

With infrastructure investing a high priority on the new administration’s docket, Washington should follow suit and put policies in place that encourage investors to finish projects and create the economic growth that the state needs. Stalling infrastructure investments like Millennium’s project will only hold back job growth and push businesses away from Washington and towards the competition. In 2017, it’s time to embrace economic growth and ease Washington’s regulatory environment.

Read the full piece here.

Southwest Washington is Poised for A Successful 2017

Last week, an article in the Vancouver Business Journal featured comments from the Columbia River Economic Development Council (CREDC) who forecast that 2017 will be a year of growth and success for Southwest Washington. The piece pointed to major infrastructure projects like Millennium Bulk Terminals’ export dock as a source of this success. These projects, they write, are poised to bring economic growth to some of the state’s poorest areas, however, they face several challenges to achieving that growth.

The piece discusses Southwest Washington’s economic outlook by county, and 2017 looks to be a good year for Cowlitz. The past several years have seen capital investment pouring in to the area, and the results have begun to show. As the article notes, “1,364 new jobs” were added in 2016 and “total potential industrial investment is about $4 billion.”

Despite this growth, the county’s unemployment rate remains well above the state average at 7.2 percent, and many of the projects expected to bring that number down face Washington’s challenging regulatory landscape.

Ted Sprague, executive director of the Cowlitz County Economic Development Council, commented on the onerous regulatory environment in Washington, saying that “consistency and timeliness of permitting” is the biggest challenge facing Cowlitz County. “There doesn’t seem to be a real urgency on behalf of our permitting partners,” he added.

Southwest Washington has all of the pieces in place for a successful 2017, and yet the state continues to cripple essential infrastructure investments with overreaching regulatory protocols. The good news is that this year we will see the release of the final state and federal Environmental Impact Statements on Millennium’s project. After nearly five years of waiting, it is time to let this critical development put folks in the community back to work.

Read the full piece here.